Dow
Chemical and DuPont have gained conditional EU antitrust approval for their
$130-billion merger, but there are a number of conditions they need to meet.
One
condition is the sale of some assets; another aims to retain research and
development of new herbicides.
“We need
effective competition in this sector so companies are pushed to develop
products that are ever safer for people and better for the environment,”
European Competition Commissioner Margrethe Vestager said in a statement.
“Our
decision today ensures that the merger between Dow and DuPont does not reduce
price competition for existing pesticides or innovation for safer and better
products in the future.”
In
return for the EU green light, DuPont will divest large parts of its global
pesticides business, including its global research and development
organization.
Dow in
turn will sell two acid co-polymer manufacturing facilities in Spain and the
United States, as well as a contract with a third party through which it buys
ionomers. The company has already found a buyer - South Korea’s SK Innovation.
Antitrust
experts said regulator’s demand to sell large swatches of R&D facilities
could set the benchmark for future deals.
Sources
said last week that ChemChina’s $43-billion bid for Syngenta could be approved
this week but the timing could slip.
Bayer
and Monsanto will also be seeking EU approval for their merger.
